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The 3 questions are connected but i don't understand how we got the answer for number 3.. can someone please clarify number 3

1. Company X produces coffee mugs. They are planning to launch an advertisement on Facebook. Their coffee mugs cost $4 to produce, and are priced at $10. The cost of the Facebook campaign is estimated to be $50,000. They estimate the additional revenue from the campaign to be around $150,000. The margin for this campaign is estimated to be 40%. What is the ROMI of this campaign? Answer: Careful: This is not about the margin (%) for the product. The question already tells you what the margin is for this specific campaign. Only take the campaign margin (%) into account when the information is provided. Cost of Campaign = $50,000 Revenue from Campaign = $120,000 ROMI = [($150,000 x 40%) - $50,000] /50,000 = 10,000/50,000 = 20% 2. A second alternative that Company X is considering is to launch their advertising campaign on TikTok. The cost of the campaign on TikTok is estimated to be $10,000, and the estimated additional revenue coming from the campaign is $52,000. The percentage margin for this campaign is estimated to be 35%. What is the ROMI of this campaign? Answer: Margin (%) = 35% Cost of Campaign = $10,000 Revenue from Campaign = $52,000 ROMI = [($32,000 x 35%) - $10,000] / 10,000 = 8,200/10,000 = 82% 3. A final alternative for Company X is to launch the advertising campaign across both platforms. Calculate what the ROMI is if Company X decides to go this route. Answer: Given that the Margin (%) is different for both campaigns, we will have to make a detailed calculation here. ROMI = [ (Margin ($) for Campaign 1 + Margin ($) for Campaign 2) - (Cost of Campaign 1 + Cost of Campaign 2)]/(Cost of Campaign 1 + Cost of Campaign 2) ROMI = ($10,000 + $8,200) / $60,000 30.3%

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